How much is your Small Business Health Care Tax Credit worth?

Today we are launching some new tools for the Small Business Health Options Program (SHOP) Marketplace, which include a tax credit estimator and FTE employee calculator. These tools make it easier for small employers to understand and take full advantage of the benefits available from the SHOP. The new FTE Calculator helps small employers determine whether they’re eligible to buy coverage for their employees in a Federally-facilitated SHOP, while the new SHOP Tax Credit Estimator lets small employers learn the size of the tax credit they might be able to receive for contributing to coverage for their employees through the SHOP.

Here are some key things you should know about the tax credit and applying for SHOP:

Employers with fewer than 25 full-time equivalent employees may be eligible for the Small Business Health Care Tax Credit, worth up to 50% of employer premiums contributions, if their employees make an average of $50,000 a year or less.

The tax credit will be available to eligible employers for two consecutive taxable years.

The tax credit may be available to eligible tax-exempt employers who could receive up to 35% of employer premium contributions, and can access the credit as a refund.

Generally, the Small Business Health Care Tax Credit is available for eligible employers purchasing SHOP health plans.

To enroll in a SHOP plan in most states, you’ll use an agent, broker, or insurance company. You’ll also need to complete a SHOP eligibility application.

Even if you’re a small employer who does not qualify for a small business tax credit, you may still purchase coverage through SHOP.

Apply for SHOP coverage any time, all year

SHOP is open to employers with 50 or fewer full-time-equivalent employees (FTEs) and enrollment is open year- round.

A new SHOP Full-Time Equivalent Calculator can help you find out if your business meets the definition of a small business for SHOP based on the number of employees. If your state runs its own SHOP, visit your state Marketplace for information on how to calculate FTEs.